' "Sam's establishment of the Walton culture throughout the company was the key to the whole thing. It'sjust incomparable. He is the greatest | businessman of this century."HARRY CUNNINGHAM, :founded Kmart Stores while CEO of S. S. Kresge Co.
Not many companies out there gather several hundred of their executives, managers, and associatestogether every Saturday morning at seven-thirty to talk about business. Even fewer would begin such ameeting by having their chairman call the Hogs. That's one of my favorite ways to wake everybody up,by doing the University of Arkansas's Razorback cheer, real early on a Saturday. You probably have tobe there to appreciate the full effect, but it goes like this:
Whoooooooooooooooooooo Pig. Sooey! Whooooooooooooooooooooooooooo Pig. Sooey!
Whoooooooooooooooooooooooooooooooo Pig.
Sooey! RAZORBACKS!!!!!
And if I'm leading the cheer, you'd better believe we do it loud. I have another cheer I lead whenever Ivisit a store: our own Wal-Mart cheer. The associates did it for President and Mrs. Bush when they werehere in Bentonville not long ago, and you could see by the look on their faces that they weren't used tothis kind of enthusiasm. For those of you who don't know, it goes like this:
Give Me a W!
Give Me an A!
Give Me an L!
Give Me a Squiggly!
(Here, everybody sort of does the twist.)Give Me an M!
Give Me an A!
Give Me an R!
Give Me a T!
What's that spellWal-Mart!
What's that spellWal-Mart!
Who's number oneTHE CUSTOMER!
I know most companies don't have cheers, and most board chairmen probably wouldn't lead them evenif they did. But then most companies don't have folks like Mike "Possum" Johnson, who entertained usone Saturday morning back when he was safety director by taking on challengers in a no-holds-barredpersimmon-seed-spitting contest, using Robert Rhoads, our company general counsel, as the officialtarget. Most companies also don't have a gospel group called the Singing Truck Drivers, or amanagement singing group called Jimmy Walker and the Accountants.
My feeling is that just because we work so hard, we don't have to go around with long faces all the time,taking ourselves seriously, pretending we're lost in thought over weighty problems. At Wal-Mart, if youhave some important business problem on your mind, you should be bringing it out in the open at aFriday morning session called the merchandising meeting or at the Saturday morning meeting, so we canall try to solve it together. But while we're doing all this work, we like to have a good time. It's sort of a"whistle while you work" philosophy, and we not only have a heck of a good time with it, we work betterbecause of it. We build spirit and excitement. We capture the attention of our folks and keep theminterested, simply because they never know what's coming next. We break down barriers, which helps uscommunicate better with one another. And we make our people feel part of a family in which no one istoo important or too puffed up to lead a cheer or be the butt of a jokeor the target in apersimmon-seed-spitting contest.
We don't pretend to have invented the idea of a strong corporate culture, and we've been aware of a lotof the others that have come before us. In the early days of IBM, some of the things Tom Watson didwith his slogans and group activities weren't all that different from the things we do. And, as I've said,we've certainly borrowed every good idea we've come across. Helen and I picked up several ideas on atrip we took to Korea and Japan in 1975. A lot of the things they do over there are very easy to apply todoing business over here. Culturally, things seem so differentlike sitting on the floor eating eels andsnailsbut people are people, and what motivates one group generally will motivate another.
HELEN WALTON:
"Sam took me out to see this tennis ball factory, somewhere east of Seoul. The company sold balls toWal-Mart, I guess, and they treated us very well. It was the dirtiest place I ever saw in my life, but Samwas very impressed. It was the first place he ever saw a group of workers have a company cheer. Andhe liked the idea of everybody doing calisthenics together at the beginning of the day. He couldn't wait toget home and try those ideas out in the stores and at the Saturday morning meeting."Back in 1984, people outside the company began to realize just how different we folks at Wal-Mart are.
That was the year I lost a bet to David Glass and had to pay up by wearing a grass skirt and doing thehula on Wall Street. I thought I would slip down there and dance, and David would videotape it so hecould prove to everyone back at the Saturday morning meeting that I really did it, but when we got there,it turned out David had hired a truckload of real hula dancers and ukulele playersand he had alerted thenewspapers and TV networks. We had all kinds of trouble with the police about permits, and thedancers' union wouldn't let them dance without heaters because it was so cold, and we finally had to getpermission from the head of Merrill Lynch to dance on his steps. Eventually, though, I slipped on thegrass skirt and the Hawaiian shirt and the leis over my suit and did what I think was a pretty fair hula. Itwas too good a picture to pass up, I guessthis crazy chairman of the board from Arkansas in this sillycostumeand it ran everywhere. It was one of the few times one of our company stunts reallyembarrassed me. But at Wal-Mart, when you make a bet like I didthat we couldn't possibly produce apretax profit of more than 8 percentyou always pay up. Doing the hula was nothing compared towrestling a bear, which is what Bob Schneider, once a warehouse manager in Palestine, Texas, had to doafter he lost a bet with his crew that they couldn't beat a production record.
Most folks probably thought we just had a wacky chairman who was pulling a pretty primitive publicitystunt. What they didn't realize is that this sort of stuff goes on all the time at Wal-Mart. It's part of ourculture, and it runs through everything we do. Whether it's Saturday morning meetings or stockholders'
meetings or store openings or just normal days, we always have tried to make life as interesting and asunpredictable as we can, and to make Wal-Mart a fun proposition. We're constantly doing crazy thingsto capture the attention of our folks and lead them to think up surprises of their own. We like to see themdo wild things in the stores that are fun for the customers and fun for the associates. If you're committedto the Wal-Mart partnership and its core values, the culture encourages you to think up all sorts of ideasthat break the mold and fight monotony.
We know that our anticsour company cheers or our songs or my hulacan sometimes be pretty corny,or hokey. We couldn't care less. Sure, it's a little strange for a vice president to dress in pink tights and along blond wig and ride a white horse around the Bentonville town square, as Charlie Self did in 1987,after he lost a Saturday morning meeting bet that December sales wouldn't top $1.3 billion. And it is oddfor a former executive like Ron Loveless to come out of retirement at every year-end meeting andpresent his annual LEIR report, the Loveless Economic Indicator Report, based on the number of edibledead chickens found on the roadsidewith charts and graphs and the whole bit. (The harder times are,the fewer edibles you find on the roadside.)Maybe it is a little hokey to surprise your president with the gift of a live pig, but that's what a Sam'sClub crew did to David Glass at one meeting to kick off a sales competition with a football theme. Theytold him they had planned to give him a pigskin, then decided, what the heck, why not leave the pig in it.
For that matter, how many other $50 billion companies would have their president put on overalls and astraw hat and ride a donkey around a parking lot That's what we made David do at the Harrison storeto make up for having toldFortune magazine his story about the donkey and the watermelons at thatstore's 1964 opening. Who knows what our competitors thought when they got their issue ofDiscountStore News that week and saw our president sitting on a jackass right there on the front pageSome of this culture grew naturally out of our small-town beginnings. Back then, we tried literally tocreate a carnival atmosphere in our stores. We were only in small towns then, and often there wasn't awhole lot else to do for entertainment that could beat going to the Wal-Mart. As I told you, we'd havethese huge sidewalk sales, and we'd have bands and little circuses in our parking lots to get folks to thosesales. We'd have plate drops, where we'd write the names of prizes on paper plates and sail them off theroofs of the stores. We'd have balloon drops. We'd have Moonlight Madness sales, which usually wouldbegin after normal closing hours and maybe last until midnight, with some new bargain or promotion beingannounced every few minutes.
We'd play shopping-cart bingowhere each shopping cart has a number, and if your number is called,you get a discount on whatever you have in the cart. At store openings, we'd stand on the servicecounters and give away boxes of candy to the customers who had traveled the farthest to get there. Aslong as it Was fun, we'd try it. Occasionally it blew up in our face.
One year, on George Washington's birthday, Phil Green (remember the world's largest Tide display)ran an ad saying his Fayetteville store was selling a television set for twenty-two centsthe birthday beingon February 22. The only hitch was that before you could buy that television set you had to find it first.
Phil had hidden it somewhere in the store, and the first person to find it, got it. When Phil arrived at thestore that morning, there was such a crowd out front that you couldn't even see the doors. I think all ofFayetteville was there, and a lot of them had been there all night. Our folks had to go in through the back.
When they finally opened the front doors, there was a stampede like you wouldn't believe: five hundredor six hundred people tearing through that store looking for one twenty-two-cent television set. Phil solda ton that day, but the place was so totally out of control that even he admitted playing hide-and-seekwith merchandise was a terrible idea.
As we've grown, we've gotten away from the circus approach, but we've made it a point to keepencouraging the spirit of fun in the stores. We want the associates and the management to do thingstogether that contribute to the community and make them feel like a team, even if they don't directly relateto selling or promoting our merchandise. Here are a few of the crazy kinds of things I'm talking about:
Our Fairbury, Nebraska, store has a "precision shopping-cart drill team" that marches in local parades.
The members all wear Wal-Mart smocks and push their carts through a routine of whirls, twirls, circles,and crossovers.
Our Cedartown, Georgia, store holds a kiss-the-pig contest to raise money for charity. They set outjars with each manager's name on them, and the manager whose jar winds up with the most donationshas to kiss a pig.
Our New Iberia, Louisiana, store fields a cheer-leading squad called the Shrinkettes. Their cheers dealmostly with, what else cutting shrinkage: "WHAT DO YOU DO ABOUT SHRINKAGE CRUSH IT!
CRUSH IT!" The Shrinkettes stole the show at one of our annual meetings with cheers like:
"CALIFORNIA ORANGES, TEXAS CACTUS, WE THINK KMART COULD USE SOMEPRACTICE!"Our Fitzgerald, Georgia, store won first place in the Irwin County Sweet Potato Parade with a floatfeaturing seven associates dressed as fruits and vegetables grown in south Georgia. As they passed thejudging stand, the homegrown fruits and vegetables did a homegrown Wal-Mart cheer.
Managers: from our Ozark, Missouri, store dressed up in pink tutus, got on the back of a flatbed truck,and cruised the town square on Friday night, the peak time for teenage cruisers, and somehow managedto raise money for charity by doing it.
As you can see, we thrive on a lot of the traditions of small-town America, especially parades withmarching bands, cheerleaders, drill teams, and floats. Most of us grew up with it, and we've found that itcan be even more fun when you're an adult who usually spends all your time working. We love all kindsof contests, and we hold them all the time for everything from poetry to singing to beautiful babies. Welike theme days, where everyone in the store dresses up in costume. Our Ardmore, Oklahoma, storepiled hay in front of the store one day, mixed $36 in coins in itand let the kids dive into it. More of ourstores than you would believe hold ladies' fashion shows using ugly old men from the stores as models.
Some of our people greetersthe associates who meet our customers as they come in the dooruse theirhigh-profile positions to have a little fun. Artie Hopper, the greeter in Huntsville, Arkansas, dresses in adifferent costume for every holidayincluding Hawgfest, a local celebration.
Then there's the World Championship Moon Pie Eating Contest.
I already told you how I pushed Moon Pies as my item one year and sold $6 million worth. But theMoon Pie contest started back in 1985, when John Love, an assistant manager at the time in Oneonta,Alabama, accidentally ordered four or five times more Moon Pies than he intended to and found himselfup to his eyeballs in them. Desperate, John came up with the idea of a Moon Pie Eating Contest as a wayto move the Moon Pies out before they went bad on him. Who would have thought something like thatwould catch on Now it's an annual event, held every fallon the second Saturday in Octoberin theparking lot of our Oneonta store. It draws spectators from several states and has been written up innewspapers and covered by television literally all over the world. As of this writing, by the way, theworld record for Moon Pie eating is sixteen double deckers in ten minutes. It was set in 1990 by a guynamed Mort Hurst, who bills himself as "the Godzilla of Gluttony."Corny How could you get any cornier than that But when folks get together and do this sort of sillystuff it's really impossible to measure just how good it is for their morale. To know that you're supposedto have a good time, that there's no place for stuffed shirts, or at least that they always get theircomeuppance, is a very uplifting thing for all of us.
Take our Saturday morning meetings, for example. Without a little entertainment and a sense of theunpredictable, how in the world could we ever have gotten those hundreds of peoplemost of ourmanagers and some associates from the general offices here in Bentonvilleto get up every Saturdaymorning and actually come in here with smiles on their faces If they knew all they could expect in thatmeeting was somebody droning on about comparative numbers, followed by a serious lecture on theproblems of our business, could we have kept the meeting alive No way. No matter how strongly I feltabout the necessity of that meeting, the folks would have revolted, and even if we still held it, it wouldn'tbe any good at all. As it is, the Saturday morning meeting is at the very heart of the Wal-Mart culture.
Don't get me wrong. We don't get up and go down there just to have fun. That Saturday morningmeeting is very much about business. Its purpose is to let everyone know what the rest of the company isup to. If we can, we find heroes among our associates in the stores and bring them in to Bentonville,where we praise them in front of the whole meeting. Everybody likes praise, and we look for everychance we can to heap it on somebody. But I don't like to go to the meeting and hear about just the goodthings that are happening. I like to hear what our weaknesses are, where we aren't doing as well as weshould and why. I like to see aproblem come up and then hear suggestions as to how it can be corrected.
If we decide we're doing something wrong, and the solution is obvious, we can order changes right thenand carry them out over the weekend, while most everybody else in the retail business is off.
The Saturday morning meeting is where we discuss and debate much of our philosophy and ourmanagement strategy: it is the fo............